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Hardin powers up: Power plant is just one development boosting the Hardin economy – Project pumping economic life into community

The last time a coal-fired power plant was built in Montana was the Colstrip 4 plant nearly 20 years ago.

Now, after much talk and planning, Centennial Energy Resources LLC has moved its Hardin project off the drawing boards and is busy pouring concrete and welding steel.

By JAN FALSTAD
Of The Gazette Staff

http://www.billingsgazette.com/index.php?id=1&display=rednews/2004/08/29/build/business/30-hardin.inc

"Rocky Mountain Power is a pretty big plant for us for now," said MDU Resources spokesman Art Thompson. "When the Hardin plant is completed, it will represent about 15 percent of our generating capacity."

Centennial’s first project was a power plant in Brazil completed last year. Hardin is its second plant. The construction project by the MDU Resources subsidiary is feeding needed dollars into the depressed local economy.

While MDU won’t release the current cost, Chief Executive Martin White told stock analysts last year that he set aside $60 million in the capital budget for the Hardin project.

The work is welcome for Hardin, which may see up to 200 jobs at the peak of construction. Hardin’s 3,300 or so residents sit in the middle of Big Horn County, which is struggling with a 12 percent unemployment rate, the highest in Montana last month.

Since the Holly Sugar refinery closed in 1979, Hardin’s economy has sputtered.

"The annual per capital income fell from abbout $18,000 to the current $10,400, which is minimum wage," said Paul Green, Hardin’s economic development director. "So, it’s ironic this plant is turning the corner."

Touring the site

The new power plant is in the shadows of the abandoned Holly Sugar factory and is being built with steel girders and a turbine bought in South Africa.

The plant sits on 30 acres sandwiched between the sugar factory and a CHS asphalt plant.

Last December, MDU started the underground work. The first steel was erected July 13 .

Like a giant game of Legos, the steel was disassembled in Newcastle, South Africa, and then marked and shipped to Montana for reassembly at Hardin.

As heavy equipment grinds and groans, kicking up dust and noise, a giant blue crane capable of lifting 200 tons lifts steel beams into place for the boiler building.

The steel skeleton is about half finished and eventually will be 140 feet tall.

"The boiler gets built first and the turbine building gets attached," said Darcy Neigum, Centennial Energy’s director of operations.

A 60-foot by 160-foot administration and storage building already is completed. In the next few weeks, construction supervisors will move out of their tiny village of six trailers parked next to each other and into the office building.

The plant will have four main buildings, plus a 250-foot stack for emissions. That’s almost as tall as the Sheraton Hotel in Billings.

However, nearby residents won’t see emissions in Hardin as they can from the coal-fired plant along the Yellowstone River in Billings, according to one supervisor.

"You can see the particulate come out there," said Jim Hunt, the site construction manager. "You won’t see that here."

On a recent tour of the site, workers were setting forms to pour concrete for the pit that will hold pumps to feed water to the turbine/generator.

The Hardin plant will use 20 to 25 cement trucks for this pour. This job went to JTL Group of Billings, a local construction materials company that MDU bought five years ago.

A cooling tower was bought from a company called Marley Cooling Technologies of Overland Park, Kan., which is installing the equipment.

Fuel will be locally mined coal, but MDU isn’t sharing details yet.

The master plan shows a Burlington Northern Santa Fe rail spur running into the plant, but those plans are in the future. In the meantime, trucks will deliver up to half a million tons of coal a year.

"A two-day supply goes into the silo," Neigum said. "There won’t be any coal stored on the ground."

Who’s who?

A year-and-a-half ago, MDU of Bismarck, N.D., created Centennial Energy to build independent power plants whose prices are not regulated by state governments.

Centennial set up another subsidiary, Rocky Mountain Power, to build the Hardin facility.

The project was launched by two Montanans who had never built a power plant. Dick Vinson of Thompson Falls and Lloyd Debruyuker of Dutton got the now-defunct Montana Power Co., to agree to buy electricity from the Hardin plant. And that contract gave their idea – one of many to build additional power plants in Montana – credibility.

The businessmen sold their concept to MDU in 2001 for undisclosed millions.

The two partners continue to plan an ethanol plant using fuel from renewable crops that would go into the Holly Sugar building.

Pat Joyce, project coordinator in the Billings office of Rocky Mountain Ethanol Inc., said the project is double its original size because domestic demand for ethanol is growing.

"We’re exploring a 60 million gallon per year facility," Joyce said. "Lenders and industry as a whole are encouraging bigger size."

The ethanol plant would employ up to 30 people, if money can be raised to build it.

The buyer

Although the Hardin power plant won’t be generating electricity until the end of next year, MDU has already sold the power to a Canadian company called Powerex, a subsidiary of BC Hydro based in Vancouver, B.C.

Powerex agreed to buy the power for three years with a possible two-year extension.

BC Hydro is the third largest utility in Canada. The company has no excess power to sell, so it set up Powerex to buy and market power primarily in the Western United States.

Doug Little, Powerex’s vice president of marketing and trade policy, said the Hardin plant represents 2 percent of its total portfolio.

Little said he cannot comment on which businesses Powerex is targeting, but he said they are local.

"We are hoping to find customers in Montana and we are actively looking for customers now," he said.

If customers cannot be found in Montana, he said the electricity would be shipped to other areas in the West. However, transmitting power cuts into profits because shipping to the West Coast adds $5 to $6 a megawatt, Little said.

Airing the permits

An environmental group based in Boulder, Colo., challenged MDU’s decision to buy a boiler built in 1968 in South Africa as an attempt to circumvent clean air standards in this country.

The group claims the older boiler isn’t subject to stricter pollution reviews under the New Source Performance Standard.

However, Debbie Skibicki, environmental engineering specialist at the Montana Department of Environmental Quality, said the Hardin plant undoubtedly will be subject to new source standards.

"There is going to be no backsliding, making things less stringent," Skibicki said. "If anything, the emission limits may become more stringent, depending on what we permit."

The Hardin plant will produce 5 percent of the 1,100 megawatts of electricity generated at the massive Colstrip complex.

"It will, when its built, be the cleanest coal plant in Montana and one of the cleanest in the U.S.," he said.

Jan Falstad can be contacted at (406) 657-1306 or at jfalstadbillingsgazette.com.

Copyright © The Billings Gazette, a division of Lee Enterprises.

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Project pumping economic life into community

By JAN FALSTAD
Of The Gazette Staff

http://www.billingsgazette.com/index.php?id=1&display=rednews/2004/08/29/build/business/35-powerplant.inc

The noise from a power plant being built just north of Hardin is sweet music to Paul Green’s ears.

As economic development director for the city of Hardin, Green is seeing construction dollars pumping life into Big Horn County and starting to offset the highest unemployment rate in the state.

"When I took over a year ago, the community had a really negative attitude," Green said. "The power plant is helping to change that."

MDU Resources – and its subsidiary – is building the $60 million coal-fired Rocky Mountain Power Plant scheduled to go on-line around Christmas next year.

Green doesn’t just see one power plant by the boarded up Holly Sugar refinery, he sees a potential industrial park of 1,000 acres. Three months ago, he set up a tradeport called Two Rivers Authority to go after tax increment dollars to help build the city’s infrastructure. Tradeports have more options than regular economic development offices, he said.

"We’re so poor, in a lot of applications, we’re considered a frontier," he said.

Green wants to build an intermodal transportation facility where shipping containers are transferred from trains to trucks.

Hardin also can take advantage of what Butte has – an east-west interstate highway crossing a north-south interstate, which makes a giant warehouse possible.

"A large distribution center would bring decent-paying jobs to a largely unskilled labor force," he said. "The jobs would pay $10 to $15 an hour, which is great for Hardin."

The airport needs remodeling, so Green is exploring the idea of becoming a fixed-base operation. That would allow the city’s airport to handle some of the FedEx, UPS and other packaged air freight that is bringing big bucks to Billings.

Then there’s the detention facility.

Green just returned from a trip to Sierra Blanca, Texas, to look at a private prison just opened by Emerald Companies. This corporation is looking at building a private prison in Hardin.

Attitudes have changed in Montana, he said.

"We went from public outcry over the Shelby Corrections Facility to 2004 to where the support here was almost 100 percent," he said.

The detention facility could bring 150 jobs to Hardin. In addition to these future plans, Green said a Pamida store is opening in a couple of weeks. The clothing and general merchandise store will help fill the void left since Stage Stores closed in Hardin three years ago.

Copyright © The Billings Gazette, a division of Lee Enterprises.

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